Tag Archives: oil

Tethys says Kazakh police raided its offices

ALMATY, NOV. 6 2016 (The Conway Bulletin) — Guernsey-registered Tethys Petroleum accused Kazakh police of raiding the offices of its subsidiaries in Kazakhstan days after a financing deal with Kazakhstan- based Olisol collapsed.

Tethys also said it had sacked Alexander Abramov, a principal at Olisol and director at Tethys, the day after the police raids . It accused Mr Abramov and Olisol of triggering the raids.

“We understand that the case was initiated by Mr Abramov. On November 2, 2016 the investigation division of the Internal Affairs Department of Almaty conducted searches of the Company’s offices,” Tethys said. Mr Abramov and Olisol have not commented.

Tethys, which operates oil and gas fields near the Aral Sea, also accused Olisol of other underhand business tactics.

The company said that its two main gas supply contracts were terminated shortly before a deadline for Olisol to pay its proposed investment. This allowed Olisol to back out of the agreement.

Essentially Tethys accused Olisol of deliberately scuppering its finance plans. Tethys had been relying on investment of $10m from Olisol, in return for equity, to push through a tough period for the energy industry.

ENDS

(News report from Issue No. 304, published on Nov. 11 2016)

Azerbaijan to supply oil to Egypt

NOV. 8 2016 (The Conway Bulletin) — A source in SOCAR, Azerbaijan’s state-owned energy company, said that the company will supply Egyptian refineries with 2m barrels of oil annually, the Amwal Al Ghad magazine reported. Last week, Egypt and Azerbaijan agreed on a supply contract after Saudi Aramco said it would halt shipments to Egypt indefinitely.

ENDS

(News report from Issue No. 304, published on Nov. 11 2016)

Kazakh oil company completes maintenance

NOV. 9 2016 (The Conway Bulletin) — Oil company PetroKazakhstan said it has completed planned maintenance and remodelling work at its Shymkent refinery three days ahead of schedule. Kazakhstan’s ministry of energy has repeatedly said that the country needs to upgrade its refineries and build a new one. London-traded KMG EP, a subsidiary of state-owned Kazmunaigas, owns a 33% stake in PetroKazakhstan, while China’s CNPC owns the rest.

ENDS

(News report from Issue No. 304, published on Nov. 11 2016)

Tethys deal with Kazakhstan’s Oilsol collapses

ALMATY, OCT. 27 2016 (The Conway Bulletin) — Guernsey-based oil company Tethys Petroleum said Kazakhstan-based investment group Olisol had failed to pay a final 9.8m Canadian dollars ($7.3m) instalment that it had promised in return for a stake in the company.

Olisol had been viewed as saviour by Tethys, which had been short of cash because of the collapse in oil prices since 2014 which has destroyed profits at energy companies, but failing to pay up on time effectively crushes the deal.

In a harsh statement, Tethys complained that despite its readiness to move forward, Olisol missed the payment deadline, jeopardising the deal.

“Olisol failed to provide Tethys with any of the C$9.8 million purchase price required to purchase the subscription shares under the Investment Agreement,” the company said, referring to the agreement the parties had signed in December 2015 and updated in April.

“Therefore, Tethys considers Olisol to be in breach of the Investment Agreement and reserves all of its legal rights.”

Tethys also said that Olisol also claimed to be entitled to a full refund of the $5.7m it had already invested in the company, because of mutated conditions.

Olisol could not be reached for a comment.

After a takeover offer from London-listed Nostrum Oil & Gas fell through in the summer of 2015, Tethys had placed all its hopes on Olisol, and its mystery backers, to inject enough money to settle its debts.

The battle for survival in Kazakhstan has become increasingly tough for Tethys, which is also involved in legal battles with its partners in Tajikistan, its other main focus in Central Asia.

Days before it announced that its deal with Olisol had fallen through, Tethys said that it had received a notice from Eurasia Gas Group, a local company which had worked with a Tethys subsidiary in Kazakhstan since 2012. Eurasia Gas said that it was suing Tethys Aral Gas for $2.6m for failing to deliver oil supplies.

This is part of a bigger row. Last month, Tethys Aral Gas had threatened to sue Eurasia Gas for $1.3m in unpaid oil supplies.

ENDS

(News report from Issue No. 303, published on Nov. 4 2016)

Stock market: Roxi Petroleum

NOV. 4 2016 (The Conway Bulletin) — On a mild slide since mid-August, Roxi Petroleum’s stock price received a bump after the company published encouraging results for its new oil wells on Oct. 28.

The London-based company, which operates the BNG Contract Area in western Kazakhstan near Tengiz, said it has almost completed the initial drilling operations at its new Deep Well 6.

The news, technical in nature, was accompanied by a high volume of trading on the stock market, sending Roxi to 10.5p, a 9% jump on the day of the announcement.

The company now needs to assess the commercial feasibility of the field at different depths. Clive Carver, the company’s chairman, said that the preliminary results at Deep Well 6 were even more encouraging than Roxi’s previously drilled deep wells.

A trio of high-ranking Kazakhs owns Roxi.

ENDS

(News report from Issue No. 303, published on Nov. 4 2016)

Netanyahu visits Kazakhstan and Azerbaijan

OCT. 30 2016 (The Conway Bulletin) — Israeli PM Benjamin Netanyahu will visit Kazakhstan and Azerbaijan over the next three months, the Israeli government said. Mr Netanyahu has visited Azerbaijan previously during a term as PM in 1997. No Israeli PM has ever visited Kazakhstan. Both Azerbaijan and Kazakhstan are Israel’s biggest oil suppliers.

ENDS

(News report from Issue No. 303, published on Nov. 4 2016)

Azerbaijan exports oil to Belarus

NOV. 1 2016 (The Conway Bulletin) — Azerbaijan sent 84,700 tonnes of oil to Belarus, the country’s first commercial energy exports to Belarus since short-lived swaps in 2010/11. Belneftekhim, the Belarusian buyer, will use Azerbaijani crude at its Mozyr refinery. Belarus is actively seeking alternative suppliers of oil as Russian shipments have failed to meet domestic demand. Azerbaijan’s oil was sent through Georgia’s Supsa port to Odessa in Ukraine and then on to Belarus.

ENDS

(News report from Issue No. 303, published on Nov. 4 2016)

CPC exports from Kazakhstan rise

NOV. 1 2016 (The Conway Bulletin) — The Caspian Pipeline Consortium, an oil transit route along the northern coast of the Caspian Sea from Kazakhstan’s oil fields to the Russian port of Novorossiysk, said it increased exports in October to around 4m tonnes, a 24% rise compared to last year. For the first 10 months of 2016, exports have reached 35.3m tonnes. If growth projections continue for the next two months, the Consortium, led by US-based Chevron, Russia’s Transneft and Kazakhstan’s Kazmunaigas, will register a record export year in 2016.

ENDS

(News report from Issue No. 303, published on Nov. 4 2016)

Shell cuts costs in Kazakhstan

NOV. 1 2016 (The Conway Bulletin) — British-Dutch oil company Shell said it will cut costs across the board, a move that is poised to impact the company’s expenditure in Kazakhstan. In Kazakhstan, Shell operates a handful of offshore fields, most notably the giant Kashagan, and is also involved in the Karachaganak gas and condensate field. Sustained low oil prices have hit energy companies’ ability to spend on their upstream projects.

ENDS

(News report from Issue No. 303, published on Nov. 4 2016)

Oil’s Fiscal Breakeven Points

OCT. 28 2016 (The Conway Bulletin) — Hiding behind timid smiles, officials from Central Asia and the South Caucasus oil and gas producing countries continue to say that the worst may be over for the region’s economic slump.

In the medium term, Kazakhstan will constantly boast about the restart of the giant Kashagan offshore project and Azerbaijan will try everything it can to attract investments for the Southern Gas Corridor, the pipeline network that will pump gas from the Caspian Sea to Europe.

Production, however, will continue to disappoint. Output will be flat in Kazakhstan, given a lift by Kashagan finally coming back on-stream after a three year delay, and decline in Azerbaijan.

Both countries have, on different occasions, praised the decision by OPEC, the oil producers’ lobby group, to freeze production to help push prices up again.

But behind the propaganda, lies a problem, which the IMF highlighted in its latest report: these countries will face higher fiscal breakeven oil prices in the next few years, piling pressure on their economies.

In April, the IMF said that the breakeven prices that Azerbaijan, Kazakhstan and Turkmenistan would need to balance their government budgets in 2016 were $47, $88 and $42.7/barrel respectively.

In a report this week, the IMF said breakeven prices for Azerbaijan and Turkmenistan had grown to $71 and $50.4/barrel respectively.

For 2016, oil prices are unlikely to average above $50/barrel, which means that the three major energy exporters in the region will have to use their reserves to prop up their economies. Officials may be happier now than in January budget issues are far from sorted.

ENDS

(News report from Issue No. 302, published on Oct. 28 2016)